Governor bares vast transportation proposal

One day before the Virginia General Assembly convenes for the final session of his term, Republican Gov. Bob McDonnell unveiled a sweeping transportation package Tuesday that scraps the state’s 17.5-cent-per-gallon gas tax and bumps Virginia’s sales and use tax nearly a percent.

The proposal, which McDonnell highlighted at a press conference in Richmond, pushes the 5-percent sales tax to 5.8 percent, a measure that would help provide more than $3 billion in transportation for the commonwealth over the next five years, according to the governor’s office.

If the governor’s proposal is adopted by state lawmakers – something that’s months and many debates away – Virginia would be the only state in the nation to do away with the gas tax.

Virginia’s current gas tax rate has gone unchanged since 1986. Factoring in inflation, a more diverse economy and an increase in energy-efficient vehicles, the gas tax mechanism has led to severe shortfalls in the growing commonwealth.

For Northern Virginia residents reliant on the Dulles Toll Road—and residents looking forward to Metro’s Silver Line extension—McDonnell’s transportation pitch specifically calls for allocating an additional $300 million for Phase Two of the Dulles Corridor Metrorail Project, or Rail to Dulles. That $300 million, paired with the $150 million the state has already devoted to the project that extends Metro to the Dulles Airport and into Loudoun, would help keep tolls from soaring along the Dulles Toll Road. The toll road is operated by the Metropolitan Washington Airports Authority, which is managing and largely funding Rail to Dulles.

Moreover, McDonnell wants to dedicate an additional .25 cent of the existing sales and use tax to transportation. Currently, transportation receives 0.5 cent of the sales tax. The governor wants to phase in this share to 0.75 cent over five years.

“When combined with the 0.8 cent sales and use tax increase, transportation will receive approximately one-quarter of sales and use tax proceeds, thus ensuring a sustainable transportation revenue stream for the future,” states a release about McDonnell’s transportation plan. “All of the revenues from the additional .25 cent will be dedicated to support maintenance and operations. During the first three years … up to $300 million will be committed to the Dulles Metrorail Extension Project, providing the reforms identified by the U.S. Department of Transportation Inspector General are implemented.”

Current projections show Virginia’s transportation maintenance funds falling $364 million short in fiscal 2013, meaning that money will be transferred from the state’s construction account to the road maintenance account. That shortfall is expected to grow to $500 million by 2019 if new funding or revenue streams aren’t aren’t secured.

“In short, Virginia has to use money meant for construction for paving and potholes,” McDonnell’s office notes.

The transportation proposal would also increase the vehicle registration fee by $15, with the revenue going toward intercity passenger rail and transit, and impose a $100 annual fee on alternative fuel vehicles, also to be used for transit.

Additionally, the tax on diesel fuel would go unchanged because “heavy trucks have a disproportionately large impact on the deterioration of Virginia’s highways,” states McDonnell’s announcement.

At the press conference, McDonnell noted that transportation and education are the two prime focuses of his final year in office.

If the state government hasn’t provided kids with world-class schools and roads, McDonnell said, then the government has failed.

“Transportation is a core function of government. Children can’t get to school; parents waste too much time in traffic; and businesses can’t move their goods without an adequate and efficient transportation system,” McDonnell said.

mephisto…..common sense and rational thought aren’t your strong suites, huh?
There’s this thing called the capitalist’s free market…and it controls the company’s ability to do that. You should do research instead of posting how you “feel” things work.

Not sure I get why diesel isn’t included in the proposal…gas tax stays on diesel…because trucks are harder on the roads? Feel sorry for my diesel owning car friends—-they’ll start selling their cars soon. So. Carolina has cheap gas but their roads are in awful shape. I’d rather pay more at the pump and KNOW that money goes to the roads then an across the board sales tax that could go to anything.

Troy—I fall on the liberal side of the political chasm, but I have to disagree. The Arlington resident walks to the grocery store but everything he buys there came in on trucks, on the road. It’s ludicrous to take the position that only some of the population use the roads. You have to consider the support structure in the economy.

What NoVA taxpayers ought to be up in arms about is the massive gouging we receive—paying far more in taxes that we receive back in relative share of transportation spending.

And on the topic of the Greenway—at public financing rates of 3%, the entire construction cost of the Greenway ($350 million) would have been paid off in 20 years (2 years from now) with fixed tolls of $1.50. Instead, we’re saddled with $5 tolls, and no end in sight.

Richmond certainly wasn’t going to stick a $5 private toll road in their own back yard. They screwed us over with one instead.

Fred, while it may sound enticing, what mephisto said is bound to come true. Does anyone think that there will be a 17.5 cent drop per gallon and then store owners for fuel suppliers won’t just eat most of that up?

mephisto - You must be a hardcore liberal, calling for higher gas taxes. You do realize that poor people who have little excess money to spend will be forced to pay higher prices at the pump? That isn’t very liberal of you.

Roads should be funded by all residents who either directly or indirectly benefit from the commerce that roads support. It only makes sense that Sales Taxes should fund the roads so that everybody in the state shares the burden, not just those who directly use the roads.

Even when somebody takes the metro or VRE to work, they still indirectly benefit from roads by the food that ends up at their grocery store, the school bus their kid takes, or the police, fire, rescue which protects them.

Ditch the User Tax on fuel and broaden the tax base with an Across the board Sales Tax to fund roads.

This doesn’t sound good. Why not keep the gas tax and just raise it? Then you have people using the roads paying for the roads. As a sales tax, you have people paying for roads that aren’t necessarily using them. It is like the Toll Road tolls that pay for Metro that the people on the road obviously aren’t using.

And $300M more for Metro! Oh, wake up people and see what a waste of money Phase 2 is. Virginia gave away BILLIONS in revenue when Tim Kaine transfered the DTR to MWAA, and now we just keep giving them more.

And, how about those of us that drive non-commercial diesel vehicles! Not only do we pay more in taxes now (but because we get better mileage it is worth it), but we are going to pay a much larger diesel penalty in the future which will negate the better gas mileage of a diesel. THIS WILL PUT AN END TO NON-COMMERCIAL DIESEL VEHICLE SALES IN VIRGINIA.

Use our most regressive tax to build roads so well-off drivers getting 15 miles to the gallon in their Escalades pay no premium for that excess? Has McDonnell gone insane? Everything about this proposal is wrong and wrong-headed.

From the minds that brought you “no car tax”—and which you still pay—here comes another one.

McDonnell needs to be handed a major defeat on this nonsense (goofier than his sell off ABC stores idea early in his term). Then the state needs to index the gas tax to inflation so it rises as the cost of fixing roads rises, raise it a few more cents now to make up for years of inaction, then get on with fixing the transportation mess that government alone can fix.

Selling off roads to private interests isn’t the answer (the Greenway should have proven this to gouged Loudoun drivers)

This is a ridiculous proposal. You can be sure Exxon and their brothers will ratchet the price up to slowly take back that 17 cents and then we’ll be paying the “gas tax” and getting NOTHING for it. The GOP is twisting itself into knots trying to keep Grover Norquist happy…so twisted that now they’ll make those who never use the roads pay for them while those who use them heavily take a free ride? Let’s hope smarter minds control the outcome of this absurd proposal down in Richmond.

Sounds like a last year in office spending spree. Funny how the fiscal conservative goes out the window when the end in his term is near.

I dont mind the rise in funding for roads and schools, but to leave it for his last year in office and basically just to make yourself look good before you leave is lame. I am sure Cooch can run against this and look like the fiscal conservative.

They typically have lower incomes and buy less, but that doesn’t mean they don’t drive a lot. Meanwhile someone who lives in Arlington may own a car, but drive 100 miles a month.

So now that Arlington resident who makes $100k and walks to the grocery store and to go out to eat will pay more taxes towards roads than someone in SW Virginia who drives 12,000 miles a year in pickup truck. Loudoun residents obviously fall in between there, as I imagine most of us drive quite a bit, but also pay plenty in sales tax throughout the year.

Does this even raise enough money? It just says $3B over the next 5 years. $3B extra? Or total?

And what would be so bad about just raising the gas tax and tying it to inflation? Sounds like more semantics from the GOP, like Minchew differentiating between a tax and “user fee”.

It is also disappointing to see the Commonwealth throw more money at MWAA and its boondoggle.

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